Market Street's new owner spells out strategy

Published: Friday, July 12, 2013 at 5:47 p.m.

Last Modified: Friday, July 12, 2013 at 5:47 p.m.

There is no secret about how to turn around the Market Street at Heath Brook shopping mall, according to a representative of its new owner.

"It's not rocket science," said Barney McAuley, managing partner at Dallas-based Tricom Real Estate Group. "Retail leasing is very hard work. You just have to explain (to potential retailers) the advantages of the location and the advantages of Ocala."

The 60-acre outdoor mall off State Road 200 and west of Interstate 75, which opened in 2008, was purchased recently by a partnership of Dallas-based MGHerring Group, Tricom Real Estate Group, and Greenwich, Conn.-based Contrarian Capital Management, LLC.

Growing the mall comes down to working with retailers and addressing their needs in helping them lease the vacant spaces, McAuley said.

Some new retailers will need help with paying rent their first year; others will need special accommodations with infrastructure.

McAuley said the first step is to use the existing stores, such as Dillard's and Dick's Sporting Goods, as the groundwork to make Market Street more successful.

The $16.5 million sale did not include the 11.4-acre Dillard's property, which the department store conglomerate purchased earlier this year. But because of Dillard's location, the rest of the mall benefits.

"Basically, we're going to build on the stores we have now," McAuley said.

The mall has nearly 530,000 square feet of retail and office, much of it un-leased. The original owner, The Ocala Shoppes LLC, filed for bankruptcy in January, unable to repay its $100 million mortgage.

McAuley said buying the mall for less than what it cost to build will allow the new owners to be more flexible in leasing.

He further said he does not see Market Street competing with Paddock Mall, but rather being a "complement" to it.

He described Paddock Mall as a "really nicely run mid-market mall," with many tenants that target younger shoppers. McAuley said Market Street and its future stores will appeal to those who already shop at stores such as Dillard's, Dick's, Old Navy and DSW Shoes.

McAuley does not foresee any changes to the physical structure of the outdoor mall. His strategy is to fill the first-floor retail space and then focus on the second floor.

New ownership also brings stability to the mall, he said, and some of the retailers there now have told him they are relieved about the mall's future.

Tricom and MGHerring own about 25 million square feet of retail space and more than 30 shopping centers and malls throughout the country.

McAuley said he is not daunted by many of the shops being vacant and instead points to Ocala's attributes, Market Street's location and potential, and Florida's economic recovery.

"It's all about the shopper being satisfied and the retailer doing well," he said.

<p>There is no secret about how to turn around the Market Street at Heath Brook shopping mall, according to a representative of its new owner.</p><p>"It's not rocket science," said Barney McAuley, managing partner at Dallas-based Tricom Real Estate Group. "Retail leasing is very hard work. You just have to explain (to potential retailers) the advantages of the location and the advantages of Ocala."</p><p>The 60-acre outdoor mall off State Road 200 and west of Interstate 75, which opened in 2008, was purchased recently by a partnership of Dallas-based MGHerring Group, Tricom Real Estate Group, and Greenwich, Conn.-based Contrarian Capital Management, LLC.</p><p>Growing the mall comes down to working with retailers and addressing their needs in helping them lease the vacant spaces, McAuley said.</p><p>Some new retailers will need help with paying rent their first year; others will need special accommodations with infrastructure.</p><p>McAuley said the first step is to use the existing stores, such as Dillard's and Dick's Sporting Goods, as the groundwork to make Market Street more successful.</p><p>The $16.5 million sale did not include the 11.4-acre Dillard's property, which the department store conglomerate purchased earlier this year. But because of Dillard's location, the rest of the mall benefits.</p><p>"Basically, we're going to build on the stores we have now," McAuley said.</p><p>The mall has nearly 530,000 square feet of retail and office, much of it un-leased. The original owner, The Ocala Shoppes LLC, filed for bankruptcy in January, unable to repay its $100 million mortgage.</p><p>McAuley said buying the mall for less than what it cost to build will allow the new owners to be more flexible in leasing.</p><p>He further said he does not see Market Street competing with Paddock Mall, but rather being a "complement" to it.</p><p>He described Paddock Mall as a "really nicely run mid-market mall," with many tenants that target younger shoppers. McAuley said Market Street and its future stores will appeal to those who already shop at stores such as Dillard's, Dick's, Old Navy and DSW Shoes.</p><p>McAuley does not foresee any changes to the physical structure of the outdoor mall. His strategy is to fill the first-floor retail space and then focus on the second floor.</p><p>New ownership also brings stability to the mall, he said, and some of the retailers there now have told him they are relieved about the mall's future.</p><p>Tricom and MGHerring own about 25 million square feet of retail space and more than 30 shopping centers and malls throughout the country.</p><p>McAuley said he is not daunted by many of the shops being vacant and instead points to Ocala's attributes, Market Street's location and potential, and Florida's economic recovery.</p><p>"It's all about the shopper being satisfied and the retailer doing well," he said.</p><p><i>Contact Fred Hiers at 867-4157 or fred.hiers@starbanner.com.</i></p>